(PUB) Morningstar FundInvestor

May 2 014

Morningstar FundInvestor

5

Data through April 30, 2014 T. Rowe Price Diversified Sm Cap Growth

Ticker

Status Yield Total Assets

Mstar Category

PRDSX Open

0.0% $798 mil

Small Growth

Morningstar Analyst Rating 04-24-14

Investment Style Equity Stock %

Historical Profile Return Risk Rating Above Avg Average Above Avg

100% 99% 99% 99% 95% 97% 99% 95%

´

Manager Change Partial Manager Change

Morningstar Pillars Process Performance

17.0 24.0 31.0

Growth of $10,000

∞ ∞ ∞ ∞ ∞

Positive Positive Positive Positive Positive

Investment Values of Fund Investment Values of S&P 500

People Parent Price

10.0

Performance Quartile (within Category) History

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 04-14

Morningstar Analyst Rating Morningstar evaluates mutual funds based on five key pillars, which its analysts believe lead to funds that are more likely to outperform over the long term on a risk-adjusted basis. Analyst Rating Spectrum Œ „ ´ˇ ¨

11.50 40.24 11.56 -8.30

12.68 10.26 -0.62 -4.05

14.01 10.49

14.48

14.25

8.59

11.85 37.98 11.52

15.82 33.50 18.44

15.45 1.54 -0.57 4.45 0.00 1.54 0.00 0.59 1.10 -0.78 13

17.44 15.69 -0.31

24.99 44.19 11.80

24.12 -3.48 -6.04 1.19 0.00 -3.48

NAV

3.35

-36.28 9.35

Total Return %

-12.44 5.58 -10.00 6.34

3.86 2.30 0.00

0.72 2.26 0.00

+/-S&P 500

3.51 0.00

4.41 0.00

1.10 0.20

0.89 0.00

+/-Russ 2000 Gr Income Return % Capital Return %

0.00

0.00

0.00

0.00 3.35

40.24

10.26

10.49

-36.28 9.35

37.98

33.50

15.49

44.19

64

65

19

96

42

14

36

16

26

31

32

Total Rtn % Rank Cat

Pillar Spectrum Positive ∞

0.00 0.00 1.25 -1.03

0.00 0.00 1.25 -0.99

0.00 0.00 1.25 -0.83

0.00 0.00 1.25 -1.01

0.00 1.55 1.25 -0.63

0.00 0.46 1.25 -0.84

0.00 0.00 1.25 -0.68

0.00 0.00 1.25 -0.74

0.03 0.40 0.91 0.22

0.00 0.15 0.82 -0.19

0.00 0.00 . . . 798

Income $

§ Negative

¶ Neutral

Capital Gains $ Expense Ratio % Income Ratio % Turnover Rate % Net Assets $mil

Performance 04-30-14 1st Qtr 2nd Qtr

3rd Qtr

4th Qtr

Total

23 75

26 83

29 87

39 89

47 88

30 56

28 79

18

17

15

13

2010 2011 2012 2013 2014

8.95 -9.22 14.76 17.62 33.50 11.44 0.28 -21.27 15.40 1.54 14.05 -5.39 5.76 1.38 15.69 12.56 3.26 13.52 9.28 44.19 -0.40 . . . .

134

189

396

771

Portfolio Analysis 03-31-14 Share change since 12-13 Total Stocks:295 Sector

Rating and Risk Time Load-Adj

PE Tot Ret% % Assets

Morningstar

Morningstar Risk vs Cat

Morningstar Risk-Adj Rating

Period Return % Rtn vs Cat

T. Rowe Price Short-Term

3.65

. . .

1 Yr 3 Yr 5 Yr

23.58 12.28 23.59 10.00

Trailing

Total

+/-

+/- Russ %Rank Growth of

Middleby Corp Maximus Inc Hanesbrands Inc NewMarket Corp Incyte Corp Ltd

Industrl Industrl Industrl

30.8 5.32 1.00 23.0 -3.13 0.84 24.7 0.43 0.81

Return% S&P 500 2000 Gr

Cat

$10,000

+Avg High +Avg

Avg Avg -Avg

3 Mo 6 Mo 1 Yr

-1.51 -7.74 2.45 -5.91 23.58 3.14 12.28 -1.55 23.59 4.45 10.00 2.33 7.77 3.52

1.49 1.18 2.12 1.95 3.09 1.15 2.11

41 9,849 35 10,245 23 12,358 11 14,155 5 28,835 14 25,937 56 30,723

Westinghouse Air Brake T

10 Yr Incept

Cnsmr Cyc 26.1 17.25 0.79 Basic Mat 21.1 11.75 0.78

7.05

3 Yr Avg 5 Yr Avg 10 Yr Avg 15 Yr Avg

Hlth care

-4.09 0.76

.

Other Measures

Standard Index

Best Fit Index Russ 2000 Gr

Boston Beer Co Inc Class Old Dominion Freight Lin Polaris Industries Inc Tyler Technologies Inc Ultimate Software Group Aspen Technology Inc Waddell & Reed Financial Acuity Brands Inc J&J Snack Foods Corp Gartner Inc Class A Rite Aid Corp FEI Co

Cnsmr Def 46.3 1.76 0.76

S&P 500

Industrl

25.3 14.35 0.75

Alpha

-4.8 1.30

2.2

Cnsmr Cyc 24.3 -7.44 0.75 Technology 26.6 -10.74 0.75 Technology 67.1 -20.05 0.73 Technology 135.1 -21.92 0.72 Cnsmr Def 33.2 44.27 0.71 Technology 51.0 2.85 0.71 Finan Svs 22.8 4.62 0.71 Technology 34.7 14.19 0.70 Cnsmr Def 26.2 6.02 0.70 Technology 35.3 -2.97 0.69 Cyclical 27.99 0.97 BasicMat 3.75 1.23 . . CnsmrCyc16.47 1.92 . . FinanSvs 5.98 0.38 . . Real Est 1.79 1.23 . . Sensitive 49.86 1.14 CommSrvs 0.38 0.09 . . Energy 5.36 0.50 . . Industrl 24.36 2.14 . . Technlgy 19.76 1.13 . . Defensive22.15 0.80 CnsmrDef 4.96 0.41 . . Hlthcare 17.19 1.45 . . Utilities 0.00 0.00 . . h r t y u j i o p a k s d f Industrl 25.0 0.22 0.68 Sector Weightings % of Stocks Rel S&P 500 High 3 Year Low

Beta

0.95

R-Squared

87

97

Tax Analysis Tax-Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat 3 Yr (estimated) 5 Yr (estimated) 10 Yr (estimated) 11.83 7 0.41 25 23.29 3 0.25 25 9.61 9 0.35 16 Potential Capital Gain Exposure: 28% of assets Morningstar’s Take by Greg Carlson 04-24-14 T. Rowe Price Diversified Small-Cap Growth remains consistently solid, if not spectacular. This fund modestly surpassed its typical small-growth peer in 2013 s furious rally, an impressive feat given its strategy. True, manager Sudhir Nanda and his team rely heavily on quantitative stock-picking models, and quant funds performed well last year. (A Morningstar list of quant funds beat 71% of their peers on average in 2013.) But this fund pays scant attention to earnings and stock price momentum--factors that fueled quant funds’ fine 2013 showing. That’s because momentum is a short-term phenomenon, and Nanda looks to hold stocks for five years. The models used here instead focus heavily on valuation, earnings quality, and financial health. Thus the fund’s holdings typically have far stronger profitability measures, and less debt, than its typical peers’. Nanda also reduces risk by spreading the assets across 300 holdings and limiting position sizes to 1%. The fund’s approach isn’t a formula for consistent

Standard Deviation

17.30 12.28

Mean

Sharpe Ratio

0.75

success when stocks go up quickly. Indeed, since Nanda took the helm in October 2006, the fund has slightly lagged both its MSCI US Small Cap Growth benchmark and the Russell 2000 Growth on average in rising markets. But the fund has made up ground by holding up better when equities turn south. Indeed, it handily beat both indexes, as well as its typical peer in 2008’s downturn and 2011’s choppy environment. During the whole of Nanda’s 7.5-year tenure through March 2014, the fund has surpassed 93% of its peers and both indexes on a risk-adjusted basis. The fund has grown steadily as it has continued to rack up solid returns, quadrupling in size since mid-2012 to a recent $800 million. But capacity isn’t a concern yet, given the fund’s small position sizes and low portfolio turnover. Furthermore, the fund’s expense ratio has fallen from 1.05% in mid-2012 to a recent 0.82%--nearly one third below the median for no-load small-cap funds. The fund’s cost edge, repeatable process, and experienced skipper bode well for its future.

Toro Co

Current Investment Style

Market Cap % Giant 0.0 Large 0.3 Mid 50.4 Small 44.0 Micro 5.3 Avg $mil: 3,261

Value Blnd Growth

Large Mid Small

Value Measures Price/Earnings Price/Book Price/Sales Price/Cash Flow Dividend Yield % Long-Term Erngs Book Value Sales Cash Flow Historical Erngs Growth Measures

Rel Category

23.14 3.40 1.75 10.56 0.49 14.75 10.72 7.37 17.17 13.64

1.10 1.39 1.26 1.13 0.71 0.92 1.44 1.56 1.23 1.50

% Rel Category

Composition - Net

Cash 3.2 Stocks 96.0 Bonds 0.7 Other 0.1 Foreign 2.7

Address:

100 East Pratt Street Baltimore, MD 21202 800-638-5660 www.troweprice.com

Minimum Purchase: Min Auto Inv Plan:

$2500 $2500

Add: $100 IRA: $1000

Add: $100

Profitability

% Rel Category

Sales Fees:

No-load, 1.00%R 0.35%, 0.15%A

Return on Equity Return on Assets Net Margin

18.31 7.21 8.66

1.58 1.67 1.27

Web Address: Inception: Advisor: Subadvisor: NTF Plans:

Management Fee:

(% of Stock)

06-30-97

Actual Fees:

Mgt:0.64% Dist: .

T. Rowe Price Associates, Inc.

Expense Projections: Income Distribution:

3Yr:$262 Annually

5Yr:$455 10Yr:$1014

None

N/A

Mutual Funds ß ®

© 2014Morningstar, Inc.All rights reserved. The information herein isnot representedorwarranted tobe accurate, correct, completeor timely.Pastperformance isnoguaranteeof future results.Accessupdated reports at To order reprints, call 312-696-6100. mfb.morningstar.com.

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